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August 14 2013 8000100
Zylkia Martin-Yambo FHWA CaiSouth Local Programs Engineer 888 S Figueroa St Su ite 750 Los Angeles CA 90017
Dear Zyikia Martin-Yambo
SUBJECT Special Experimental Project No 14 (SEP-14)
The attached SEP-14 outlines a five-year Job Order Contracting (JOC) pilot program which San Diego Association of Governments (SANDAG) wishes to utilize for the performance of federally funded and eligible minor or recurring construction or for the renovation alteration or repair of freeways and conventional highways In support of this application below is my legal opinion as SANDAGs General Counsel that the JOC process is a legal contracting method for SANDAG
SANDAGs permissible contracting and procurement methods are broad in nature and are reflected in Public Utilities Code 1323524
(a) The Legislature finds and declares that there is a compelling interest in ensuring that all federal state local and private funds available to (SANDAG) are captured and used in a timely manner In order to maximize the use of federal state local and private funds and to maintain a competitive posture in seeking supplemental federal funds (SANDAG) shall have the authority to establish and use a flexible contracting process to maximize efficient use of public funds
Section 1323524 (b) then sets forth specific allowances and limitations for SANDAGs contracting concluding with the following catch-all allowance Notwithstanding any other provisions of this chapter (SANDAG) is authorized to use any procurement method authorized for state or local agencies by state or federal law
Certain public entities in California are expressly authorized to use the JOC process within limited parameters SANDAGs ability to utilize the JOC contracting process is premised upon the statutory allowance granted to such entities Conversely however SANDAG shares in the same general limitations imposed on the JOC process by this statutory framework
401 8 Street Suite 800
San Diego CA 92 10 1- 4231
(619) 699-1900
Fax (619) 699-1905
wwwsandagorg
MEMBER AGENCIES
Cities of
Carlsbad
Chula Vista
Coronado
DelMar
El Cajon
Encinitas
Escondido
Imperial Beach
LaMesa
Lemon Grove
National City
Oceanside
Poway
San Diego
San Marcos
Santee
Solana Beach
Vista
and
County ofSan Diego
ADVISORY MEMBERS
Imperial County
California Department of Transportation
Metropolitan Transit System
North County Transit Distria
United States Department ofDefense
San Diego Unified Port District
Scln Diego County Water Authority
Southern California Tribal Chairmens Association
Mexico
DJrgcopyrgorg~~ I l AUG 2 2 2013 -~ IUJ
As a general principle JOCs are not allowed as a public entity contracting method absent an express grant of authority 76 Ops Cal Atty Gen 126 (1993) The Public Contract Code (PCC) does however specify at least three circumstances where JOCs may be utilized by public entities
PCC section 201285 allows the board of supervisors of a county to award one or more JOCs none of which shall exceed three million dollars The object of these contracts must be repair remodeling or other repetitive work to be done according to unit prices which shall not include design or contract drawings Additionally the contracts must be based on plans and specifications for typical work defined as a work description applicable universally or applicable to a large number of individual projects as distinguished from work specifically described with respect to an individual project Section 201285 prohibits the use of a JOC for new construction
PCC section 10710 allows the Trustees of the California State University system to award JOCs not exceeding three million dollars for repair or other repetitive work or renovation or modification to be done according to unit prices The contracts must be awarded to the lowest responsible bidder and shall be based primarily on plans and specifications for typical work which is defined as a work description applicable universally or applicable to a large number of individual projects as distinguished from work specifically described with respect to an individual project
PCC sections 20919- 2091915 allow on a pilot basis the Los Angeles Unified School District to utilize the JOC process on contracts not in excess of five million dollars No specific limitations are prescribed for its use apart from various labor practices provisions
Additionally Charter Cities organized pursuant to Article 11 Section 3 of the Ca lifornia Constitution may utilize JOCs under limited circumstances Charter cities are not requ ired to comply with the general public entity bidding statutes provided that the city charter or a city ordinance exempts the city from such statutes and the subject matter of the bid constitutes a municipal affair (generally a project wholly within the citys boundaries and not involving state or federal funding) Pub Cont Code sect 11007 see also R amp A Vending Services Inc v City of Los Angeles 172 Cal App 3d 1188 (1985) Howard Contracting Inc v GA MacDonald Constr Co 71 Cal App 4th 38 (1998) Currently the charter cities in San Diego County include Chula Vista Del Mar San Diego San Marcos and Vista Of these only the City of San Diego specifically allows Job Order Contracting (Charter section 941) No specific limitations are placed on its use apart from an overall contract limit of ten million dollars
Because SANDAGs contracting methodology may be based on state or federal law the FTAs specific allowance of JOCs is also illustrative FTAs Best Practices Procurement Manual (Section 616) endorses a JOC process utilized for the repair alteration modernization maintenance and rehabilitation of buildings structures or other real property
Thus overall SANDAG may employ the JOC process on projects with all of the following attributes
bull ihe project involves repair renovation alteration remodeling maintenance rehabilitation or other repetitive work and does not involve new construction
bull The individual job order is to be awarded primarily utilizing unit prices set forth in the underlying contract
bull The individual job order does not necessitate the extensive use of design or contract drawings but instead is primarily based on the standard drawings set forth in the underlying contract
If you have any additional questions regarding SANDAG use of the JOC process please feel free to contact me directly at (619) 699-1997
Sincerely
JOHN F KIRK General Counsel
JKImpo
Attachment
3
Attachment
San Diego Association of Governments Job Order Contracting Work Plan for
Federal Highway Administration (FHWA) Funded Projects
I PURPOSE
The purpose of this SEP-14 work plan is to outline a five-year Job Order Contracting (JOC) pilot program which the San Diego Association of Governments SANDAG proposes to utilize for the performance of federally funded and eligible minor or recurring construction or for the renovation alteration or repair of freeways and conventional highways Examples of minor construction include fencing environmentally sensitive areas prior to the start of work on a major construction contract (such as fencing to protect Arroyo Toad habitat chain and mow to prevent project delays due to migratory bird work windows and construction of environmental mitigation projects for major projects The pilot will evaluate the JOC procurement methods ability to
bull Provide quick and more timely project delivery bull Reduce design costs procurement costs and construction costs bull Provide a more efficient and flexible contracting method that SANDAG can use
to address changing field conditions
II BACKGROUND
JOC was developed in the early 1980s to help the Department of Defense DOD expedite the procurement of repair alteration and minor new construction projects in support of its military facilities worldwide DOD was looking for a procurement system to decrease the inherent inefficiencies in the typical design-bid-construct cycle when applied to a large volume of small to medium-sized construction projects The in itia l results and benefits experienced by DOD were so positive that within a few years the JOC procurement system was implemented at virtually every major DOD installation worldwide
Beginning in the early 1990s non-DOD public facilities owners became aware of the substantial benefits of the JOC procurement system and began adopting JOC Thus JOC began rapidly migrating outside the DOD and quickly became a heavily utilized tool by municipal governments state agencies K-12 public school systems utility and transportation authorities colleges universities and public housing authorities Today JOC is used in almost every major metropolitan market to quickly and efficiently procure over $15 billion annually in repair alteration and minor new construction projects
In 2007 recognizing SANDAGs dynamic environment and the need for a more responsive contracting technique for the accomplishment of maintenance repair and construction projects the SANDAG Board of Directors authorized the use of the JOC system as an innovative contracting system to enhance responsiveness while providing
a higher level of quality work at a lower cost The JOC system has proven to be a successful and cost-effective procurement approach that has earned itself top honors for best practices in public procurement by the National Institute of Governmental Purchasing
Ill SCOPE
A Job Order Contracting Overview
A JOC construction contract is built around a set of contract documents SANDAGs JOC contract documents consist of three (3) parts
Part 1 is a Construction Task Catalogreg (CTC) that contains a wide variety of construction and construction-related tasks Development and administration of the CTC is through a Consultant to SANDAG whom is selected by a competitive procurement process prior to procuring a contractor to perform JOC work Each task in the CTC has a complete and detailed description a unit of measure and a fixed unit price For example a square foot of interior painting a linear foot of rigid conduit and a square yard of carpet all have a certain associated price The unit prices include the direct cost of labor material and equipment in the local market The unit prices for some tasks are modified for large or small quantities non-typical installation locations (ie in a confined space) or non-typical materials (ie sta inless steel) The tasks in the CTC are developed and tailored specifically for SANDAG and encompass all the work that SANDAG anticipates completing under a JOC
Part 2 of the contract documents is a set of performance-based Special Provisions recognized by and familiar to bidders The Special Provisions reflect SANDAGs standards for the quality of workmanship and materials and set the standard for the quality of work The Special Provisions also include the Information for Bidders form of contract General Conditions wage rate information etc
Part 3 consists of the bid forms including a bidders bond
B The JOC Bidding Process
During the bidding process bidders are not told the exact tasks that they will be asked to perform No commitments are made about specific quantities that will be ordered from the CTC SANDAG informs bidders of some specific contract characteristics that are unique to JOC such as
1 Each JOC contract will have a definitive term Each contract features a threeshyyear term from the date of contract award The total term of the JOC contract cannot exceed three years
2
2 There is a m1mmum contract value set forth in the contract-limited by SANDAG Board Policy to a maximum of $50000-in order to provide sufficient consideration to make the contract binding There is also a not-to-exceed Maximum Contract Value set forth in the contract
3 A pre-bid meeting is held for all potential bidders The contractors are given an overview of JOC and encouraged to ask questions about how it works The pre shybid meeting is conducted as a workshop and the mechanics of being a Job Order Contractor are explained Contractors are given guidance on analyzing the CTC how to calculate adjustment factors how to develop a price proposal personnel requirements to staff a Job Order Contract and generally how to be successful under the JOC system
C The JOC Contractor Selection Process
Based on the Construction Task Catalog the Special Provisions and the guidance provided at the pre-bid meeting bidders competitively bid a set number of adjustment factors to be appl ied to the unit prices in the CTC The adjustment factors may recognize various work factors including performing work 1) during normal working hours 2) during other than normal working hours and 3) restricted work shifts
The adjustment factors must include all of the contractors indirect costs such as overhead insurance and bonds as well as the contractors profit The adjustment factors apply to every task in the CTC Adjustment factors can vary widely among different facility owners and contracts based on a host of factors including the maximum contract value the type of work anticipated and the locations and conditions under which the work will likely be executed If a bidder views the CTC as equal to the direct cost of performing the work in the local marketplace and desires 10 for overhead and 10 for profit they would bid with a multiplier of 120 Furthermore if the bidder believes that work to be completed during other than normal hours will require higher wages to be paid than work completed during normal hours they would incorporate a premium into that adjustment factor
Each adjustment factor is weighted (as determined prior to the bid and indicated on the bid form) and an award criteria figure is calculated The award is made to the bidder providing the lowest (lowest and best award criteria figure) responsible and responsive bid The contractor must also provide a statement of qualifications that demonstrates certain skill sets licenses and similar experience to be determined responsible and meet criteria under Best Value Procurement
3
D Contract Execution and Job Order Utilization
Once SANDAG has executed a Job Order Contract with each contractor they are standing by available to perform work when called upon The Job Order execution process begins with the identification of a project an understanding of the general scope of work associated with the project and an independent cost estimate prepared by the Project Manager (PM) After these preliminary steps are completed the PM conducts a Joint Scope Meeting with the contractor to review the proposed general scope of work and evaluate the work site conditions The contractor is invited to ask questions and make suggestions
After t he Joint Scope Meeting the PM provides the contractor with a written Detailed Scope of Work The level of detail and design included in the Detailed Scope of Work is a function of the difficulty and type of the particular project The contractor then breaks the work down into individual items of work and prepares a pricing proposal by selecting the unit price tasks contained in the CTC to accomplish the Detailed Scope of Work The total price is calculated by multiplying each unit price by the required quantity and then multiplying that result by the appropriate adjustment factor Along with the proposal the contractor also develops a schedule a list of subcontractors and any required drawings or sketches
The proposal is then compared to SANDAGs independent cost estimate and reviewed to make sure the contractor selected the correct tasks and appropriate quantities If the PM is satisfied with the proposal the proposal is submitted for an independent contractual legal and financial review Once approved a firm fixed price job order is issued to the contractor
The contractor is required to complete the Detailed Scope of Work for the lump sum price within the agreed-upon schedule Once the work begins the PM reviews submittals inspects the work monitors progress approves payments and closes out the job in accordance with typical SANDAG procedures No variations from the procedures are permitted
E Compliance with Federal Regulations
On Job Orders funded directly by or assisted in whole or in part by and through the federal government the contractor must comply with all applicable federal laws rules and regulations including but not limited to the following
bull The Copeland Anti-Kickback Act (18 USC Section 874) as supplemented in Department of Labor regulations (29 CFR part 3)
bull The Anti-Kickback Act of 1986 (41 USC Section 51 et seq)
4
bull Sections 103 and 107 of the Contact Work Hours and Safety Standards Act (40 USC 327-330) as supplemented by Department of Labor regulations (29 CFR part 5)
bull The Federal Fair Labor Standards Act (29 USC Section 201 et seq) bull Buy America Requirements (49 CFR Part 661 and Section 165 of the Surface
Transportation Act of 1982) and bull Disadvantaged Business Enterprise Program (49 CFR Part 26)
The General Accounting Office has fully reviewed the JOC concept and found it to be consistent with all federal procurement laws and policies
The JOC concept was designed with internal controls as an integral part of the checks and balances process The JOC concept relies on automated software developed by a consultant to SANDAG which provides an excellent audit trail of all JOC job orders and transactions as well as various verification programs to ensure the integrity of the JOC database
IV SCHEDULE
As of October 2011 SANDAGs existing JOC program for regionally funded projects has resulted in the completion and issuance of 61 job orders totaling approximately $272 million Approximately a third of those were related to improvements on the state highway system The state highway projects have included demolition chaining and mowing plant establishment and construction of minor operational features Based on this success the region is intending to procure new JOCs by mid 2013 Prior to this new procurement SANDAG wishes to expand the program to include federally funded highway improvements similar to the existing contracts Based on the current expenditure rates the region would anticipate needing two JOes to cover the five-year period for this SEP-14 The first JOC would cover the first three years of the SEP14 for $15 million (2013-2016) The second JOC would be written for the final two years for $10 million (2016-2018) Performance reports will be provided after two and four years with a final performance report provided at the completion of the five year period
V MEASURES
The benefits of JOC can vary by job order however as a program SANDAG expects to see benefits in cost and time The Interim and Final SEP-14 Evaluation Report would address the following
bull Time to complete the plans bull Cost to complete the plans bull Time and cost of bid and award process
bull Overall cost to Award
5
Projects uWizing JOCs will be measured against the California Department of Transportat ion (Caltrans) District lls Minor Project Program as a baseline for traditional design-bid-build projects
VI REPORTING
An interim report will be completed two and four years into the process with a final submitted afterthe five year period has ended A report will be generated if a JOC has not been utilized stating no JOCs used The reports will contain a comparison of the JOC vs Caltrans process on each JOC used utilizinging the Measures listed above The final report will include an overall evaluation of the project along with any suggestions and recommendations for improving the process
6
As a general principle JOCs are not allowed as a public entity contracting method absent an express grant of authority 76 Ops Cal Atty Gen 126 (1993) The Public Contract Code (PCC) does however specify at least three circumstances where JOCs may be utilized by public entities
PCC section 201285 allows the board of supervisors of a county to award one or more JOCs none of which shall exceed three million dollars The object of these contracts must be repair remodeling or other repetitive work to be done according to unit prices which shall not include design or contract drawings Additionally the contracts must be based on plans and specifications for typical work defined as a work description applicable universally or applicable to a large number of individual projects as distinguished from work specifically described with respect to an individual project Section 201285 prohibits the use of a JOC for new construction
PCC section 10710 allows the Trustees of the California State University system to award JOCs not exceeding three million dollars for repair or other repetitive work or renovation or modification to be done according to unit prices The contracts must be awarded to the lowest responsible bidder and shall be based primarily on plans and specifications for typical work which is defined as a work description applicable universally or applicable to a large number of individual projects as distinguished from work specifically described with respect to an individual project
PCC sections 20919- 2091915 allow on a pilot basis the Los Angeles Unified School District to utilize the JOC process on contracts not in excess of five million dollars No specific limitations are prescribed for its use apart from various labor practices provisions
Additionally Charter Cities organized pursuant to Article 11 Section 3 of the Ca lifornia Constitution may utilize JOCs under limited circumstances Charter cities are not requ ired to comply with the general public entity bidding statutes provided that the city charter or a city ordinance exempts the city from such statutes and the subject matter of the bid constitutes a municipal affair (generally a project wholly within the citys boundaries and not involving state or federal funding) Pub Cont Code sect 11007 see also R amp A Vending Services Inc v City of Los Angeles 172 Cal App 3d 1188 (1985) Howard Contracting Inc v GA MacDonald Constr Co 71 Cal App 4th 38 (1998) Currently the charter cities in San Diego County include Chula Vista Del Mar San Diego San Marcos and Vista Of these only the City of San Diego specifically allows Job Order Contracting (Charter section 941) No specific limitations are placed on its use apart from an overall contract limit of ten million dollars
Because SANDAGs contracting methodology may be based on state or federal law the FTAs specific allowance of JOCs is also illustrative FTAs Best Practices Procurement Manual (Section 616) endorses a JOC process utilized for the repair alteration modernization maintenance and rehabilitation of buildings structures or other real property
Thus overall SANDAG may employ the JOC process on projects with all of the following attributes
bull ihe project involves repair renovation alteration remodeling maintenance rehabilitation or other repetitive work and does not involve new construction
bull The individual job order is to be awarded primarily utilizing unit prices set forth in the underlying contract
bull The individual job order does not necessitate the extensive use of design or contract drawings but instead is primarily based on the standard drawings set forth in the underlying contract
If you have any additional questions regarding SANDAG use of the JOC process please feel free to contact me directly at (619) 699-1997
Sincerely
JOHN F KIRK General Counsel
JKImpo
Attachment
3
Attachment
San Diego Association of Governments Job Order Contracting Work Plan for
Federal Highway Administration (FHWA) Funded Projects
I PURPOSE
The purpose of this SEP-14 work plan is to outline a five-year Job Order Contracting (JOC) pilot program which the San Diego Association of Governments SANDAG proposes to utilize for the performance of federally funded and eligible minor or recurring construction or for the renovation alteration or repair of freeways and conventional highways Examples of minor construction include fencing environmentally sensitive areas prior to the start of work on a major construction contract (such as fencing to protect Arroyo Toad habitat chain and mow to prevent project delays due to migratory bird work windows and construction of environmental mitigation projects for major projects The pilot will evaluate the JOC procurement methods ability to
bull Provide quick and more timely project delivery bull Reduce design costs procurement costs and construction costs bull Provide a more efficient and flexible contracting method that SANDAG can use
to address changing field conditions
II BACKGROUND
JOC was developed in the early 1980s to help the Department of Defense DOD expedite the procurement of repair alteration and minor new construction projects in support of its military facilities worldwide DOD was looking for a procurement system to decrease the inherent inefficiencies in the typical design-bid-construct cycle when applied to a large volume of small to medium-sized construction projects The in itia l results and benefits experienced by DOD were so positive that within a few years the JOC procurement system was implemented at virtually every major DOD installation worldwide
Beginning in the early 1990s non-DOD public facilities owners became aware of the substantial benefits of the JOC procurement system and began adopting JOC Thus JOC began rapidly migrating outside the DOD and quickly became a heavily utilized tool by municipal governments state agencies K-12 public school systems utility and transportation authorities colleges universities and public housing authorities Today JOC is used in almost every major metropolitan market to quickly and efficiently procure over $15 billion annually in repair alteration and minor new construction projects
In 2007 recognizing SANDAGs dynamic environment and the need for a more responsive contracting technique for the accomplishment of maintenance repair and construction projects the SANDAG Board of Directors authorized the use of the JOC system as an innovative contracting system to enhance responsiveness while providing
a higher level of quality work at a lower cost The JOC system has proven to be a successful and cost-effective procurement approach that has earned itself top honors for best practices in public procurement by the National Institute of Governmental Purchasing
Ill SCOPE
A Job Order Contracting Overview
A JOC construction contract is built around a set of contract documents SANDAGs JOC contract documents consist of three (3) parts
Part 1 is a Construction Task Catalogreg (CTC) that contains a wide variety of construction and construction-related tasks Development and administration of the CTC is through a Consultant to SANDAG whom is selected by a competitive procurement process prior to procuring a contractor to perform JOC work Each task in the CTC has a complete and detailed description a unit of measure and a fixed unit price For example a square foot of interior painting a linear foot of rigid conduit and a square yard of carpet all have a certain associated price The unit prices include the direct cost of labor material and equipment in the local market The unit prices for some tasks are modified for large or small quantities non-typical installation locations (ie in a confined space) or non-typical materials (ie sta inless steel) The tasks in the CTC are developed and tailored specifically for SANDAG and encompass all the work that SANDAG anticipates completing under a JOC
Part 2 of the contract documents is a set of performance-based Special Provisions recognized by and familiar to bidders The Special Provisions reflect SANDAGs standards for the quality of workmanship and materials and set the standard for the quality of work The Special Provisions also include the Information for Bidders form of contract General Conditions wage rate information etc
Part 3 consists of the bid forms including a bidders bond
B The JOC Bidding Process
During the bidding process bidders are not told the exact tasks that they will be asked to perform No commitments are made about specific quantities that will be ordered from the CTC SANDAG informs bidders of some specific contract characteristics that are unique to JOC such as
1 Each JOC contract will have a definitive term Each contract features a threeshyyear term from the date of contract award The total term of the JOC contract cannot exceed three years
2
2 There is a m1mmum contract value set forth in the contract-limited by SANDAG Board Policy to a maximum of $50000-in order to provide sufficient consideration to make the contract binding There is also a not-to-exceed Maximum Contract Value set forth in the contract
3 A pre-bid meeting is held for all potential bidders The contractors are given an overview of JOC and encouraged to ask questions about how it works The pre shybid meeting is conducted as a workshop and the mechanics of being a Job Order Contractor are explained Contractors are given guidance on analyzing the CTC how to calculate adjustment factors how to develop a price proposal personnel requirements to staff a Job Order Contract and generally how to be successful under the JOC system
C The JOC Contractor Selection Process
Based on the Construction Task Catalog the Special Provisions and the guidance provided at the pre-bid meeting bidders competitively bid a set number of adjustment factors to be appl ied to the unit prices in the CTC The adjustment factors may recognize various work factors including performing work 1) during normal working hours 2) during other than normal working hours and 3) restricted work shifts
The adjustment factors must include all of the contractors indirect costs such as overhead insurance and bonds as well as the contractors profit The adjustment factors apply to every task in the CTC Adjustment factors can vary widely among different facility owners and contracts based on a host of factors including the maximum contract value the type of work anticipated and the locations and conditions under which the work will likely be executed If a bidder views the CTC as equal to the direct cost of performing the work in the local marketplace and desires 10 for overhead and 10 for profit they would bid with a multiplier of 120 Furthermore if the bidder believes that work to be completed during other than normal hours will require higher wages to be paid than work completed during normal hours they would incorporate a premium into that adjustment factor
Each adjustment factor is weighted (as determined prior to the bid and indicated on the bid form) and an award criteria figure is calculated The award is made to the bidder providing the lowest (lowest and best award criteria figure) responsible and responsive bid The contractor must also provide a statement of qualifications that demonstrates certain skill sets licenses and similar experience to be determined responsible and meet criteria under Best Value Procurement
3
D Contract Execution and Job Order Utilization
Once SANDAG has executed a Job Order Contract with each contractor they are standing by available to perform work when called upon The Job Order execution process begins with the identification of a project an understanding of the general scope of work associated with the project and an independent cost estimate prepared by the Project Manager (PM) After these preliminary steps are completed the PM conducts a Joint Scope Meeting with the contractor to review the proposed general scope of work and evaluate the work site conditions The contractor is invited to ask questions and make suggestions
After t he Joint Scope Meeting the PM provides the contractor with a written Detailed Scope of Work The level of detail and design included in the Detailed Scope of Work is a function of the difficulty and type of the particular project The contractor then breaks the work down into individual items of work and prepares a pricing proposal by selecting the unit price tasks contained in the CTC to accomplish the Detailed Scope of Work The total price is calculated by multiplying each unit price by the required quantity and then multiplying that result by the appropriate adjustment factor Along with the proposal the contractor also develops a schedule a list of subcontractors and any required drawings or sketches
The proposal is then compared to SANDAGs independent cost estimate and reviewed to make sure the contractor selected the correct tasks and appropriate quantities If the PM is satisfied with the proposal the proposal is submitted for an independent contractual legal and financial review Once approved a firm fixed price job order is issued to the contractor
The contractor is required to complete the Detailed Scope of Work for the lump sum price within the agreed-upon schedule Once the work begins the PM reviews submittals inspects the work monitors progress approves payments and closes out the job in accordance with typical SANDAG procedures No variations from the procedures are permitted
E Compliance with Federal Regulations
On Job Orders funded directly by or assisted in whole or in part by and through the federal government the contractor must comply with all applicable federal laws rules and regulations including but not limited to the following
bull The Copeland Anti-Kickback Act (18 USC Section 874) as supplemented in Department of Labor regulations (29 CFR part 3)
bull The Anti-Kickback Act of 1986 (41 USC Section 51 et seq)
4
bull Sections 103 and 107 of the Contact Work Hours and Safety Standards Act (40 USC 327-330) as supplemented by Department of Labor regulations (29 CFR part 5)
bull The Federal Fair Labor Standards Act (29 USC Section 201 et seq) bull Buy America Requirements (49 CFR Part 661 and Section 165 of the Surface
Transportation Act of 1982) and bull Disadvantaged Business Enterprise Program (49 CFR Part 26)
The General Accounting Office has fully reviewed the JOC concept and found it to be consistent with all federal procurement laws and policies
The JOC concept was designed with internal controls as an integral part of the checks and balances process The JOC concept relies on automated software developed by a consultant to SANDAG which provides an excellent audit trail of all JOC job orders and transactions as well as various verification programs to ensure the integrity of the JOC database
IV SCHEDULE
As of October 2011 SANDAGs existing JOC program for regionally funded projects has resulted in the completion and issuance of 61 job orders totaling approximately $272 million Approximately a third of those were related to improvements on the state highway system The state highway projects have included demolition chaining and mowing plant establishment and construction of minor operational features Based on this success the region is intending to procure new JOCs by mid 2013 Prior to this new procurement SANDAG wishes to expand the program to include federally funded highway improvements similar to the existing contracts Based on the current expenditure rates the region would anticipate needing two JOes to cover the five-year period for this SEP-14 The first JOC would cover the first three years of the SEP14 for $15 million (2013-2016) The second JOC would be written for the final two years for $10 million (2016-2018) Performance reports will be provided after two and four years with a final performance report provided at the completion of the five year period
V MEASURES
The benefits of JOC can vary by job order however as a program SANDAG expects to see benefits in cost and time The Interim and Final SEP-14 Evaluation Report would address the following
bull Time to complete the plans bull Cost to complete the plans bull Time and cost of bid and award process
bull Overall cost to Award
5
Projects uWizing JOCs will be measured against the California Department of Transportat ion (Caltrans) District lls Minor Project Program as a baseline for traditional design-bid-build projects
VI REPORTING
An interim report will be completed two and four years into the process with a final submitted afterthe five year period has ended A report will be generated if a JOC has not been utilized stating no JOCs used The reports will contain a comparison of the JOC vs Caltrans process on each JOC used utilizinging the Measures listed above The final report will include an overall evaluation of the project along with any suggestions and recommendations for improving the process
6
bull The individual job order is to be awarded primarily utilizing unit prices set forth in the underlying contract
bull The individual job order does not necessitate the extensive use of design or contract drawings but instead is primarily based on the standard drawings set forth in the underlying contract
If you have any additional questions regarding SANDAG use of the JOC process please feel free to contact me directly at (619) 699-1997
Sincerely
JOHN F KIRK General Counsel
JKImpo
Attachment
3
Attachment
San Diego Association of Governments Job Order Contracting Work Plan for
Federal Highway Administration (FHWA) Funded Projects
I PURPOSE
The purpose of this SEP-14 work plan is to outline a five-year Job Order Contracting (JOC) pilot program which the San Diego Association of Governments SANDAG proposes to utilize for the performance of federally funded and eligible minor or recurring construction or for the renovation alteration or repair of freeways and conventional highways Examples of minor construction include fencing environmentally sensitive areas prior to the start of work on a major construction contract (such as fencing to protect Arroyo Toad habitat chain and mow to prevent project delays due to migratory bird work windows and construction of environmental mitigation projects for major projects The pilot will evaluate the JOC procurement methods ability to
bull Provide quick and more timely project delivery bull Reduce design costs procurement costs and construction costs bull Provide a more efficient and flexible contracting method that SANDAG can use
to address changing field conditions
II BACKGROUND
JOC was developed in the early 1980s to help the Department of Defense DOD expedite the procurement of repair alteration and minor new construction projects in support of its military facilities worldwide DOD was looking for a procurement system to decrease the inherent inefficiencies in the typical design-bid-construct cycle when applied to a large volume of small to medium-sized construction projects The in itia l results and benefits experienced by DOD were so positive that within a few years the JOC procurement system was implemented at virtually every major DOD installation worldwide
Beginning in the early 1990s non-DOD public facilities owners became aware of the substantial benefits of the JOC procurement system and began adopting JOC Thus JOC began rapidly migrating outside the DOD and quickly became a heavily utilized tool by municipal governments state agencies K-12 public school systems utility and transportation authorities colleges universities and public housing authorities Today JOC is used in almost every major metropolitan market to quickly and efficiently procure over $15 billion annually in repair alteration and minor new construction projects
In 2007 recognizing SANDAGs dynamic environment and the need for a more responsive contracting technique for the accomplishment of maintenance repair and construction projects the SANDAG Board of Directors authorized the use of the JOC system as an innovative contracting system to enhance responsiveness while providing
a higher level of quality work at a lower cost The JOC system has proven to be a successful and cost-effective procurement approach that has earned itself top honors for best practices in public procurement by the National Institute of Governmental Purchasing
Ill SCOPE
A Job Order Contracting Overview
A JOC construction contract is built around a set of contract documents SANDAGs JOC contract documents consist of three (3) parts
Part 1 is a Construction Task Catalogreg (CTC) that contains a wide variety of construction and construction-related tasks Development and administration of the CTC is through a Consultant to SANDAG whom is selected by a competitive procurement process prior to procuring a contractor to perform JOC work Each task in the CTC has a complete and detailed description a unit of measure and a fixed unit price For example a square foot of interior painting a linear foot of rigid conduit and a square yard of carpet all have a certain associated price The unit prices include the direct cost of labor material and equipment in the local market The unit prices for some tasks are modified for large or small quantities non-typical installation locations (ie in a confined space) or non-typical materials (ie sta inless steel) The tasks in the CTC are developed and tailored specifically for SANDAG and encompass all the work that SANDAG anticipates completing under a JOC
Part 2 of the contract documents is a set of performance-based Special Provisions recognized by and familiar to bidders The Special Provisions reflect SANDAGs standards for the quality of workmanship and materials and set the standard for the quality of work The Special Provisions also include the Information for Bidders form of contract General Conditions wage rate information etc
Part 3 consists of the bid forms including a bidders bond
B The JOC Bidding Process
During the bidding process bidders are not told the exact tasks that they will be asked to perform No commitments are made about specific quantities that will be ordered from the CTC SANDAG informs bidders of some specific contract characteristics that are unique to JOC such as
1 Each JOC contract will have a definitive term Each contract features a threeshyyear term from the date of contract award The total term of the JOC contract cannot exceed three years
2
2 There is a m1mmum contract value set forth in the contract-limited by SANDAG Board Policy to a maximum of $50000-in order to provide sufficient consideration to make the contract binding There is also a not-to-exceed Maximum Contract Value set forth in the contract
3 A pre-bid meeting is held for all potential bidders The contractors are given an overview of JOC and encouraged to ask questions about how it works The pre shybid meeting is conducted as a workshop and the mechanics of being a Job Order Contractor are explained Contractors are given guidance on analyzing the CTC how to calculate adjustment factors how to develop a price proposal personnel requirements to staff a Job Order Contract and generally how to be successful under the JOC system
C The JOC Contractor Selection Process
Based on the Construction Task Catalog the Special Provisions and the guidance provided at the pre-bid meeting bidders competitively bid a set number of adjustment factors to be appl ied to the unit prices in the CTC The adjustment factors may recognize various work factors including performing work 1) during normal working hours 2) during other than normal working hours and 3) restricted work shifts
The adjustment factors must include all of the contractors indirect costs such as overhead insurance and bonds as well as the contractors profit The adjustment factors apply to every task in the CTC Adjustment factors can vary widely among different facility owners and contracts based on a host of factors including the maximum contract value the type of work anticipated and the locations and conditions under which the work will likely be executed If a bidder views the CTC as equal to the direct cost of performing the work in the local marketplace and desires 10 for overhead and 10 for profit they would bid with a multiplier of 120 Furthermore if the bidder believes that work to be completed during other than normal hours will require higher wages to be paid than work completed during normal hours they would incorporate a premium into that adjustment factor
Each adjustment factor is weighted (as determined prior to the bid and indicated on the bid form) and an award criteria figure is calculated The award is made to the bidder providing the lowest (lowest and best award criteria figure) responsible and responsive bid The contractor must also provide a statement of qualifications that demonstrates certain skill sets licenses and similar experience to be determined responsible and meet criteria under Best Value Procurement
3
D Contract Execution and Job Order Utilization
Once SANDAG has executed a Job Order Contract with each contractor they are standing by available to perform work when called upon The Job Order execution process begins with the identification of a project an understanding of the general scope of work associated with the project and an independent cost estimate prepared by the Project Manager (PM) After these preliminary steps are completed the PM conducts a Joint Scope Meeting with the contractor to review the proposed general scope of work and evaluate the work site conditions The contractor is invited to ask questions and make suggestions
After t he Joint Scope Meeting the PM provides the contractor with a written Detailed Scope of Work The level of detail and design included in the Detailed Scope of Work is a function of the difficulty and type of the particular project The contractor then breaks the work down into individual items of work and prepares a pricing proposal by selecting the unit price tasks contained in the CTC to accomplish the Detailed Scope of Work The total price is calculated by multiplying each unit price by the required quantity and then multiplying that result by the appropriate adjustment factor Along with the proposal the contractor also develops a schedule a list of subcontractors and any required drawings or sketches
The proposal is then compared to SANDAGs independent cost estimate and reviewed to make sure the contractor selected the correct tasks and appropriate quantities If the PM is satisfied with the proposal the proposal is submitted for an independent contractual legal and financial review Once approved a firm fixed price job order is issued to the contractor
The contractor is required to complete the Detailed Scope of Work for the lump sum price within the agreed-upon schedule Once the work begins the PM reviews submittals inspects the work monitors progress approves payments and closes out the job in accordance with typical SANDAG procedures No variations from the procedures are permitted
E Compliance with Federal Regulations
On Job Orders funded directly by or assisted in whole or in part by and through the federal government the contractor must comply with all applicable federal laws rules and regulations including but not limited to the following
bull The Copeland Anti-Kickback Act (18 USC Section 874) as supplemented in Department of Labor regulations (29 CFR part 3)
bull The Anti-Kickback Act of 1986 (41 USC Section 51 et seq)
4
bull Sections 103 and 107 of the Contact Work Hours and Safety Standards Act (40 USC 327-330) as supplemented by Department of Labor regulations (29 CFR part 5)
bull The Federal Fair Labor Standards Act (29 USC Section 201 et seq) bull Buy America Requirements (49 CFR Part 661 and Section 165 of the Surface
Transportation Act of 1982) and bull Disadvantaged Business Enterprise Program (49 CFR Part 26)
The General Accounting Office has fully reviewed the JOC concept and found it to be consistent with all federal procurement laws and policies
The JOC concept was designed with internal controls as an integral part of the checks and balances process The JOC concept relies on automated software developed by a consultant to SANDAG which provides an excellent audit trail of all JOC job orders and transactions as well as various verification programs to ensure the integrity of the JOC database
IV SCHEDULE
As of October 2011 SANDAGs existing JOC program for regionally funded projects has resulted in the completion and issuance of 61 job orders totaling approximately $272 million Approximately a third of those were related to improvements on the state highway system The state highway projects have included demolition chaining and mowing plant establishment and construction of minor operational features Based on this success the region is intending to procure new JOCs by mid 2013 Prior to this new procurement SANDAG wishes to expand the program to include federally funded highway improvements similar to the existing contracts Based on the current expenditure rates the region would anticipate needing two JOes to cover the five-year period for this SEP-14 The first JOC would cover the first three years of the SEP14 for $15 million (2013-2016) The second JOC would be written for the final two years for $10 million (2016-2018) Performance reports will be provided after two and four years with a final performance report provided at the completion of the five year period
V MEASURES
The benefits of JOC can vary by job order however as a program SANDAG expects to see benefits in cost and time The Interim and Final SEP-14 Evaluation Report would address the following
bull Time to complete the plans bull Cost to complete the plans bull Time and cost of bid and award process
bull Overall cost to Award
5
Projects uWizing JOCs will be measured against the California Department of Transportat ion (Caltrans) District lls Minor Project Program as a baseline for traditional design-bid-build projects
VI REPORTING
An interim report will be completed two and four years into the process with a final submitted afterthe five year period has ended A report will be generated if a JOC has not been utilized stating no JOCs used The reports will contain a comparison of the JOC vs Caltrans process on each JOC used utilizinging the Measures listed above The final report will include an overall evaluation of the project along with any suggestions and recommendations for improving the process
6
Attachment
San Diego Association of Governments Job Order Contracting Work Plan for
Federal Highway Administration (FHWA) Funded Projects
I PURPOSE
The purpose of this SEP-14 work plan is to outline a five-year Job Order Contracting (JOC) pilot program which the San Diego Association of Governments SANDAG proposes to utilize for the performance of federally funded and eligible minor or recurring construction or for the renovation alteration or repair of freeways and conventional highways Examples of minor construction include fencing environmentally sensitive areas prior to the start of work on a major construction contract (such as fencing to protect Arroyo Toad habitat chain and mow to prevent project delays due to migratory bird work windows and construction of environmental mitigation projects for major projects The pilot will evaluate the JOC procurement methods ability to
bull Provide quick and more timely project delivery bull Reduce design costs procurement costs and construction costs bull Provide a more efficient and flexible contracting method that SANDAG can use
to address changing field conditions
II BACKGROUND
JOC was developed in the early 1980s to help the Department of Defense DOD expedite the procurement of repair alteration and minor new construction projects in support of its military facilities worldwide DOD was looking for a procurement system to decrease the inherent inefficiencies in the typical design-bid-construct cycle when applied to a large volume of small to medium-sized construction projects The in itia l results and benefits experienced by DOD were so positive that within a few years the JOC procurement system was implemented at virtually every major DOD installation worldwide
Beginning in the early 1990s non-DOD public facilities owners became aware of the substantial benefits of the JOC procurement system and began adopting JOC Thus JOC began rapidly migrating outside the DOD and quickly became a heavily utilized tool by municipal governments state agencies K-12 public school systems utility and transportation authorities colleges universities and public housing authorities Today JOC is used in almost every major metropolitan market to quickly and efficiently procure over $15 billion annually in repair alteration and minor new construction projects
In 2007 recognizing SANDAGs dynamic environment and the need for a more responsive contracting technique for the accomplishment of maintenance repair and construction projects the SANDAG Board of Directors authorized the use of the JOC system as an innovative contracting system to enhance responsiveness while providing
a higher level of quality work at a lower cost The JOC system has proven to be a successful and cost-effective procurement approach that has earned itself top honors for best practices in public procurement by the National Institute of Governmental Purchasing
Ill SCOPE
A Job Order Contracting Overview
A JOC construction contract is built around a set of contract documents SANDAGs JOC contract documents consist of three (3) parts
Part 1 is a Construction Task Catalogreg (CTC) that contains a wide variety of construction and construction-related tasks Development and administration of the CTC is through a Consultant to SANDAG whom is selected by a competitive procurement process prior to procuring a contractor to perform JOC work Each task in the CTC has a complete and detailed description a unit of measure and a fixed unit price For example a square foot of interior painting a linear foot of rigid conduit and a square yard of carpet all have a certain associated price The unit prices include the direct cost of labor material and equipment in the local market The unit prices for some tasks are modified for large or small quantities non-typical installation locations (ie in a confined space) or non-typical materials (ie sta inless steel) The tasks in the CTC are developed and tailored specifically for SANDAG and encompass all the work that SANDAG anticipates completing under a JOC
Part 2 of the contract documents is a set of performance-based Special Provisions recognized by and familiar to bidders The Special Provisions reflect SANDAGs standards for the quality of workmanship and materials and set the standard for the quality of work The Special Provisions also include the Information for Bidders form of contract General Conditions wage rate information etc
Part 3 consists of the bid forms including a bidders bond
B The JOC Bidding Process
During the bidding process bidders are not told the exact tasks that they will be asked to perform No commitments are made about specific quantities that will be ordered from the CTC SANDAG informs bidders of some specific contract characteristics that are unique to JOC such as
1 Each JOC contract will have a definitive term Each contract features a threeshyyear term from the date of contract award The total term of the JOC contract cannot exceed three years
2
2 There is a m1mmum contract value set forth in the contract-limited by SANDAG Board Policy to a maximum of $50000-in order to provide sufficient consideration to make the contract binding There is also a not-to-exceed Maximum Contract Value set forth in the contract
3 A pre-bid meeting is held for all potential bidders The contractors are given an overview of JOC and encouraged to ask questions about how it works The pre shybid meeting is conducted as a workshop and the mechanics of being a Job Order Contractor are explained Contractors are given guidance on analyzing the CTC how to calculate adjustment factors how to develop a price proposal personnel requirements to staff a Job Order Contract and generally how to be successful under the JOC system
C The JOC Contractor Selection Process
Based on the Construction Task Catalog the Special Provisions and the guidance provided at the pre-bid meeting bidders competitively bid a set number of adjustment factors to be appl ied to the unit prices in the CTC The adjustment factors may recognize various work factors including performing work 1) during normal working hours 2) during other than normal working hours and 3) restricted work shifts
The adjustment factors must include all of the contractors indirect costs such as overhead insurance and bonds as well as the contractors profit The adjustment factors apply to every task in the CTC Adjustment factors can vary widely among different facility owners and contracts based on a host of factors including the maximum contract value the type of work anticipated and the locations and conditions under which the work will likely be executed If a bidder views the CTC as equal to the direct cost of performing the work in the local marketplace and desires 10 for overhead and 10 for profit they would bid with a multiplier of 120 Furthermore if the bidder believes that work to be completed during other than normal hours will require higher wages to be paid than work completed during normal hours they would incorporate a premium into that adjustment factor
Each adjustment factor is weighted (as determined prior to the bid and indicated on the bid form) and an award criteria figure is calculated The award is made to the bidder providing the lowest (lowest and best award criteria figure) responsible and responsive bid The contractor must also provide a statement of qualifications that demonstrates certain skill sets licenses and similar experience to be determined responsible and meet criteria under Best Value Procurement
3
D Contract Execution and Job Order Utilization
Once SANDAG has executed a Job Order Contract with each contractor they are standing by available to perform work when called upon The Job Order execution process begins with the identification of a project an understanding of the general scope of work associated with the project and an independent cost estimate prepared by the Project Manager (PM) After these preliminary steps are completed the PM conducts a Joint Scope Meeting with the contractor to review the proposed general scope of work and evaluate the work site conditions The contractor is invited to ask questions and make suggestions
After t he Joint Scope Meeting the PM provides the contractor with a written Detailed Scope of Work The level of detail and design included in the Detailed Scope of Work is a function of the difficulty and type of the particular project The contractor then breaks the work down into individual items of work and prepares a pricing proposal by selecting the unit price tasks contained in the CTC to accomplish the Detailed Scope of Work The total price is calculated by multiplying each unit price by the required quantity and then multiplying that result by the appropriate adjustment factor Along with the proposal the contractor also develops a schedule a list of subcontractors and any required drawings or sketches
The proposal is then compared to SANDAGs independent cost estimate and reviewed to make sure the contractor selected the correct tasks and appropriate quantities If the PM is satisfied with the proposal the proposal is submitted for an independent contractual legal and financial review Once approved a firm fixed price job order is issued to the contractor
The contractor is required to complete the Detailed Scope of Work for the lump sum price within the agreed-upon schedule Once the work begins the PM reviews submittals inspects the work monitors progress approves payments and closes out the job in accordance with typical SANDAG procedures No variations from the procedures are permitted
E Compliance with Federal Regulations
On Job Orders funded directly by or assisted in whole or in part by and through the federal government the contractor must comply with all applicable federal laws rules and regulations including but not limited to the following
bull The Copeland Anti-Kickback Act (18 USC Section 874) as supplemented in Department of Labor regulations (29 CFR part 3)
bull The Anti-Kickback Act of 1986 (41 USC Section 51 et seq)
4
bull Sections 103 and 107 of the Contact Work Hours and Safety Standards Act (40 USC 327-330) as supplemented by Department of Labor regulations (29 CFR part 5)
bull The Federal Fair Labor Standards Act (29 USC Section 201 et seq) bull Buy America Requirements (49 CFR Part 661 and Section 165 of the Surface
Transportation Act of 1982) and bull Disadvantaged Business Enterprise Program (49 CFR Part 26)
The General Accounting Office has fully reviewed the JOC concept and found it to be consistent with all federal procurement laws and policies
The JOC concept was designed with internal controls as an integral part of the checks and balances process The JOC concept relies on automated software developed by a consultant to SANDAG which provides an excellent audit trail of all JOC job orders and transactions as well as various verification programs to ensure the integrity of the JOC database
IV SCHEDULE
As of October 2011 SANDAGs existing JOC program for regionally funded projects has resulted in the completion and issuance of 61 job orders totaling approximately $272 million Approximately a third of those were related to improvements on the state highway system The state highway projects have included demolition chaining and mowing plant establishment and construction of minor operational features Based on this success the region is intending to procure new JOCs by mid 2013 Prior to this new procurement SANDAG wishes to expand the program to include federally funded highway improvements similar to the existing contracts Based on the current expenditure rates the region would anticipate needing two JOes to cover the five-year period for this SEP-14 The first JOC would cover the first three years of the SEP14 for $15 million (2013-2016) The second JOC would be written for the final two years for $10 million (2016-2018) Performance reports will be provided after two and four years with a final performance report provided at the completion of the five year period
V MEASURES
The benefits of JOC can vary by job order however as a program SANDAG expects to see benefits in cost and time The Interim and Final SEP-14 Evaluation Report would address the following
bull Time to complete the plans bull Cost to complete the plans bull Time and cost of bid and award process
bull Overall cost to Award
5
Projects uWizing JOCs will be measured against the California Department of Transportat ion (Caltrans) District lls Minor Project Program as a baseline for traditional design-bid-build projects
VI REPORTING
An interim report will be completed two and four years into the process with a final submitted afterthe five year period has ended A report will be generated if a JOC has not been utilized stating no JOCs used The reports will contain a comparison of the JOC vs Caltrans process on each JOC used utilizinging the Measures listed above The final report will include an overall evaluation of the project along with any suggestions and recommendations for improving the process
6
a higher level of quality work at a lower cost The JOC system has proven to be a successful and cost-effective procurement approach that has earned itself top honors for best practices in public procurement by the National Institute of Governmental Purchasing
Ill SCOPE
A Job Order Contracting Overview
A JOC construction contract is built around a set of contract documents SANDAGs JOC contract documents consist of three (3) parts
Part 1 is a Construction Task Catalogreg (CTC) that contains a wide variety of construction and construction-related tasks Development and administration of the CTC is through a Consultant to SANDAG whom is selected by a competitive procurement process prior to procuring a contractor to perform JOC work Each task in the CTC has a complete and detailed description a unit of measure and a fixed unit price For example a square foot of interior painting a linear foot of rigid conduit and a square yard of carpet all have a certain associated price The unit prices include the direct cost of labor material and equipment in the local market The unit prices for some tasks are modified for large or small quantities non-typical installation locations (ie in a confined space) or non-typical materials (ie sta inless steel) The tasks in the CTC are developed and tailored specifically for SANDAG and encompass all the work that SANDAG anticipates completing under a JOC
Part 2 of the contract documents is a set of performance-based Special Provisions recognized by and familiar to bidders The Special Provisions reflect SANDAGs standards for the quality of workmanship and materials and set the standard for the quality of work The Special Provisions also include the Information for Bidders form of contract General Conditions wage rate information etc
Part 3 consists of the bid forms including a bidders bond
B The JOC Bidding Process
During the bidding process bidders are not told the exact tasks that they will be asked to perform No commitments are made about specific quantities that will be ordered from the CTC SANDAG informs bidders of some specific contract characteristics that are unique to JOC such as
1 Each JOC contract will have a definitive term Each contract features a threeshyyear term from the date of contract award The total term of the JOC contract cannot exceed three years
2
2 There is a m1mmum contract value set forth in the contract-limited by SANDAG Board Policy to a maximum of $50000-in order to provide sufficient consideration to make the contract binding There is also a not-to-exceed Maximum Contract Value set forth in the contract
3 A pre-bid meeting is held for all potential bidders The contractors are given an overview of JOC and encouraged to ask questions about how it works The pre shybid meeting is conducted as a workshop and the mechanics of being a Job Order Contractor are explained Contractors are given guidance on analyzing the CTC how to calculate adjustment factors how to develop a price proposal personnel requirements to staff a Job Order Contract and generally how to be successful under the JOC system
C The JOC Contractor Selection Process
Based on the Construction Task Catalog the Special Provisions and the guidance provided at the pre-bid meeting bidders competitively bid a set number of adjustment factors to be appl ied to the unit prices in the CTC The adjustment factors may recognize various work factors including performing work 1) during normal working hours 2) during other than normal working hours and 3) restricted work shifts
The adjustment factors must include all of the contractors indirect costs such as overhead insurance and bonds as well as the contractors profit The adjustment factors apply to every task in the CTC Adjustment factors can vary widely among different facility owners and contracts based on a host of factors including the maximum contract value the type of work anticipated and the locations and conditions under which the work will likely be executed If a bidder views the CTC as equal to the direct cost of performing the work in the local marketplace and desires 10 for overhead and 10 for profit they would bid with a multiplier of 120 Furthermore if the bidder believes that work to be completed during other than normal hours will require higher wages to be paid than work completed during normal hours they would incorporate a premium into that adjustment factor
Each adjustment factor is weighted (as determined prior to the bid and indicated on the bid form) and an award criteria figure is calculated The award is made to the bidder providing the lowest (lowest and best award criteria figure) responsible and responsive bid The contractor must also provide a statement of qualifications that demonstrates certain skill sets licenses and similar experience to be determined responsible and meet criteria under Best Value Procurement
3
D Contract Execution and Job Order Utilization
Once SANDAG has executed a Job Order Contract with each contractor they are standing by available to perform work when called upon The Job Order execution process begins with the identification of a project an understanding of the general scope of work associated with the project and an independent cost estimate prepared by the Project Manager (PM) After these preliminary steps are completed the PM conducts a Joint Scope Meeting with the contractor to review the proposed general scope of work and evaluate the work site conditions The contractor is invited to ask questions and make suggestions
After t he Joint Scope Meeting the PM provides the contractor with a written Detailed Scope of Work The level of detail and design included in the Detailed Scope of Work is a function of the difficulty and type of the particular project The contractor then breaks the work down into individual items of work and prepares a pricing proposal by selecting the unit price tasks contained in the CTC to accomplish the Detailed Scope of Work The total price is calculated by multiplying each unit price by the required quantity and then multiplying that result by the appropriate adjustment factor Along with the proposal the contractor also develops a schedule a list of subcontractors and any required drawings or sketches
The proposal is then compared to SANDAGs independent cost estimate and reviewed to make sure the contractor selected the correct tasks and appropriate quantities If the PM is satisfied with the proposal the proposal is submitted for an independent contractual legal and financial review Once approved a firm fixed price job order is issued to the contractor
The contractor is required to complete the Detailed Scope of Work for the lump sum price within the agreed-upon schedule Once the work begins the PM reviews submittals inspects the work monitors progress approves payments and closes out the job in accordance with typical SANDAG procedures No variations from the procedures are permitted
E Compliance with Federal Regulations
On Job Orders funded directly by or assisted in whole or in part by and through the federal government the contractor must comply with all applicable federal laws rules and regulations including but not limited to the following
bull The Copeland Anti-Kickback Act (18 USC Section 874) as supplemented in Department of Labor regulations (29 CFR part 3)
bull The Anti-Kickback Act of 1986 (41 USC Section 51 et seq)
4
bull Sections 103 and 107 of the Contact Work Hours and Safety Standards Act (40 USC 327-330) as supplemented by Department of Labor regulations (29 CFR part 5)
bull The Federal Fair Labor Standards Act (29 USC Section 201 et seq) bull Buy America Requirements (49 CFR Part 661 and Section 165 of the Surface
Transportation Act of 1982) and bull Disadvantaged Business Enterprise Program (49 CFR Part 26)
The General Accounting Office has fully reviewed the JOC concept and found it to be consistent with all federal procurement laws and policies
The JOC concept was designed with internal controls as an integral part of the checks and balances process The JOC concept relies on automated software developed by a consultant to SANDAG which provides an excellent audit trail of all JOC job orders and transactions as well as various verification programs to ensure the integrity of the JOC database
IV SCHEDULE
As of October 2011 SANDAGs existing JOC program for regionally funded projects has resulted in the completion and issuance of 61 job orders totaling approximately $272 million Approximately a third of those were related to improvements on the state highway system The state highway projects have included demolition chaining and mowing plant establishment and construction of minor operational features Based on this success the region is intending to procure new JOCs by mid 2013 Prior to this new procurement SANDAG wishes to expand the program to include federally funded highway improvements similar to the existing contracts Based on the current expenditure rates the region would anticipate needing two JOes to cover the five-year period for this SEP-14 The first JOC would cover the first three years of the SEP14 for $15 million (2013-2016) The second JOC would be written for the final two years for $10 million (2016-2018) Performance reports will be provided after two and four years with a final performance report provided at the completion of the five year period
V MEASURES
The benefits of JOC can vary by job order however as a program SANDAG expects to see benefits in cost and time The Interim and Final SEP-14 Evaluation Report would address the following
bull Time to complete the plans bull Cost to complete the plans bull Time and cost of bid and award process
bull Overall cost to Award
5
Projects uWizing JOCs will be measured against the California Department of Transportat ion (Caltrans) District lls Minor Project Program as a baseline for traditional design-bid-build projects
VI REPORTING
An interim report will be completed two and four years into the process with a final submitted afterthe five year period has ended A report will be generated if a JOC has not been utilized stating no JOCs used The reports will contain a comparison of the JOC vs Caltrans process on each JOC used utilizinging the Measures listed above The final report will include an overall evaluation of the project along with any suggestions and recommendations for improving the process
6
2 There is a m1mmum contract value set forth in the contract-limited by SANDAG Board Policy to a maximum of $50000-in order to provide sufficient consideration to make the contract binding There is also a not-to-exceed Maximum Contract Value set forth in the contract
3 A pre-bid meeting is held for all potential bidders The contractors are given an overview of JOC and encouraged to ask questions about how it works The pre shybid meeting is conducted as a workshop and the mechanics of being a Job Order Contractor are explained Contractors are given guidance on analyzing the CTC how to calculate adjustment factors how to develop a price proposal personnel requirements to staff a Job Order Contract and generally how to be successful under the JOC system
C The JOC Contractor Selection Process
Based on the Construction Task Catalog the Special Provisions and the guidance provided at the pre-bid meeting bidders competitively bid a set number of adjustment factors to be appl ied to the unit prices in the CTC The adjustment factors may recognize various work factors including performing work 1) during normal working hours 2) during other than normal working hours and 3) restricted work shifts
The adjustment factors must include all of the contractors indirect costs such as overhead insurance and bonds as well as the contractors profit The adjustment factors apply to every task in the CTC Adjustment factors can vary widely among different facility owners and contracts based on a host of factors including the maximum contract value the type of work anticipated and the locations and conditions under which the work will likely be executed If a bidder views the CTC as equal to the direct cost of performing the work in the local marketplace and desires 10 for overhead and 10 for profit they would bid with a multiplier of 120 Furthermore if the bidder believes that work to be completed during other than normal hours will require higher wages to be paid than work completed during normal hours they would incorporate a premium into that adjustment factor
Each adjustment factor is weighted (as determined prior to the bid and indicated on the bid form) and an award criteria figure is calculated The award is made to the bidder providing the lowest (lowest and best award criteria figure) responsible and responsive bid The contractor must also provide a statement of qualifications that demonstrates certain skill sets licenses and similar experience to be determined responsible and meet criteria under Best Value Procurement
3
D Contract Execution and Job Order Utilization
Once SANDAG has executed a Job Order Contract with each contractor they are standing by available to perform work when called upon The Job Order execution process begins with the identification of a project an understanding of the general scope of work associated with the project and an independent cost estimate prepared by the Project Manager (PM) After these preliminary steps are completed the PM conducts a Joint Scope Meeting with the contractor to review the proposed general scope of work and evaluate the work site conditions The contractor is invited to ask questions and make suggestions
After t he Joint Scope Meeting the PM provides the contractor with a written Detailed Scope of Work The level of detail and design included in the Detailed Scope of Work is a function of the difficulty and type of the particular project The contractor then breaks the work down into individual items of work and prepares a pricing proposal by selecting the unit price tasks contained in the CTC to accomplish the Detailed Scope of Work The total price is calculated by multiplying each unit price by the required quantity and then multiplying that result by the appropriate adjustment factor Along with the proposal the contractor also develops a schedule a list of subcontractors and any required drawings or sketches
The proposal is then compared to SANDAGs independent cost estimate and reviewed to make sure the contractor selected the correct tasks and appropriate quantities If the PM is satisfied with the proposal the proposal is submitted for an independent contractual legal and financial review Once approved a firm fixed price job order is issued to the contractor
The contractor is required to complete the Detailed Scope of Work for the lump sum price within the agreed-upon schedule Once the work begins the PM reviews submittals inspects the work monitors progress approves payments and closes out the job in accordance with typical SANDAG procedures No variations from the procedures are permitted
E Compliance with Federal Regulations
On Job Orders funded directly by or assisted in whole or in part by and through the federal government the contractor must comply with all applicable federal laws rules and regulations including but not limited to the following
bull The Copeland Anti-Kickback Act (18 USC Section 874) as supplemented in Department of Labor regulations (29 CFR part 3)
bull The Anti-Kickback Act of 1986 (41 USC Section 51 et seq)
4
bull Sections 103 and 107 of the Contact Work Hours and Safety Standards Act (40 USC 327-330) as supplemented by Department of Labor regulations (29 CFR part 5)
bull The Federal Fair Labor Standards Act (29 USC Section 201 et seq) bull Buy America Requirements (49 CFR Part 661 and Section 165 of the Surface
Transportation Act of 1982) and bull Disadvantaged Business Enterprise Program (49 CFR Part 26)
The General Accounting Office has fully reviewed the JOC concept and found it to be consistent with all federal procurement laws and policies
The JOC concept was designed with internal controls as an integral part of the checks and balances process The JOC concept relies on automated software developed by a consultant to SANDAG which provides an excellent audit trail of all JOC job orders and transactions as well as various verification programs to ensure the integrity of the JOC database
IV SCHEDULE
As of October 2011 SANDAGs existing JOC program for regionally funded projects has resulted in the completion and issuance of 61 job orders totaling approximately $272 million Approximately a third of those were related to improvements on the state highway system The state highway projects have included demolition chaining and mowing plant establishment and construction of minor operational features Based on this success the region is intending to procure new JOCs by mid 2013 Prior to this new procurement SANDAG wishes to expand the program to include federally funded highway improvements similar to the existing contracts Based on the current expenditure rates the region would anticipate needing two JOes to cover the five-year period for this SEP-14 The first JOC would cover the first three years of the SEP14 for $15 million (2013-2016) The second JOC would be written for the final two years for $10 million (2016-2018) Performance reports will be provided after two and four years with a final performance report provided at the completion of the five year period
V MEASURES
The benefits of JOC can vary by job order however as a program SANDAG expects to see benefits in cost and time The Interim and Final SEP-14 Evaluation Report would address the following
bull Time to complete the plans bull Cost to complete the plans bull Time and cost of bid and award process
bull Overall cost to Award
5
Projects uWizing JOCs will be measured against the California Department of Transportat ion (Caltrans) District lls Minor Project Program as a baseline for traditional design-bid-build projects
VI REPORTING
An interim report will be completed two and four years into the process with a final submitted afterthe five year period has ended A report will be generated if a JOC has not been utilized stating no JOCs used The reports will contain a comparison of the JOC vs Caltrans process on each JOC used utilizinging the Measures listed above The final report will include an overall evaluation of the project along with any suggestions and recommendations for improving the process
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D Contract Execution and Job Order Utilization
Once SANDAG has executed a Job Order Contract with each contractor they are standing by available to perform work when called upon The Job Order execution process begins with the identification of a project an understanding of the general scope of work associated with the project and an independent cost estimate prepared by the Project Manager (PM) After these preliminary steps are completed the PM conducts a Joint Scope Meeting with the contractor to review the proposed general scope of work and evaluate the work site conditions The contractor is invited to ask questions and make suggestions
After t he Joint Scope Meeting the PM provides the contractor with a written Detailed Scope of Work The level of detail and design included in the Detailed Scope of Work is a function of the difficulty and type of the particular project The contractor then breaks the work down into individual items of work and prepares a pricing proposal by selecting the unit price tasks contained in the CTC to accomplish the Detailed Scope of Work The total price is calculated by multiplying each unit price by the required quantity and then multiplying that result by the appropriate adjustment factor Along with the proposal the contractor also develops a schedule a list of subcontractors and any required drawings or sketches
The proposal is then compared to SANDAGs independent cost estimate and reviewed to make sure the contractor selected the correct tasks and appropriate quantities If the PM is satisfied with the proposal the proposal is submitted for an independent contractual legal and financial review Once approved a firm fixed price job order is issued to the contractor
The contractor is required to complete the Detailed Scope of Work for the lump sum price within the agreed-upon schedule Once the work begins the PM reviews submittals inspects the work monitors progress approves payments and closes out the job in accordance with typical SANDAG procedures No variations from the procedures are permitted
E Compliance with Federal Regulations
On Job Orders funded directly by or assisted in whole or in part by and through the federal government the contractor must comply with all applicable federal laws rules and regulations including but not limited to the following
bull The Copeland Anti-Kickback Act (18 USC Section 874) as supplemented in Department of Labor regulations (29 CFR part 3)
bull The Anti-Kickback Act of 1986 (41 USC Section 51 et seq)
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bull Sections 103 and 107 of the Contact Work Hours and Safety Standards Act (40 USC 327-330) as supplemented by Department of Labor regulations (29 CFR part 5)
bull The Federal Fair Labor Standards Act (29 USC Section 201 et seq) bull Buy America Requirements (49 CFR Part 661 and Section 165 of the Surface
Transportation Act of 1982) and bull Disadvantaged Business Enterprise Program (49 CFR Part 26)
The General Accounting Office has fully reviewed the JOC concept and found it to be consistent with all federal procurement laws and policies
The JOC concept was designed with internal controls as an integral part of the checks and balances process The JOC concept relies on automated software developed by a consultant to SANDAG which provides an excellent audit trail of all JOC job orders and transactions as well as various verification programs to ensure the integrity of the JOC database
IV SCHEDULE
As of October 2011 SANDAGs existing JOC program for regionally funded projects has resulted in the completion and issuance of 61 job orders totaling approximately $272 million Approximately a third of those were related to improvements on the state highway system The state highway projects have included demolition chaining and mowing plant establishment and construction of minor operational features Based on this success the region is intending to procure new JOCs by mid 2013 Prior to this new procurement SANDAG wishes to expand the program to include federally funded highway improvements similar to the existing contracts Based on the current expenditure rates the region would anticipate needing two JOes to cover the five-year period for this SEP-14 The first JOC would cover the first three years of the SEP14 for $15 million (2013-2016) The second JOC would be written for the final two years for $10 million (2016-2018) Performance reports will be provided after two and four years with a final performance report provided at the completion of the five year period
V MEASURES
The benefits of JOC can vary by job order however as a program SANDAG expects to see benefits in cost and time The Interim and Final SEP-14 Evaluation Report would address the following
bull Time to complete the plans bull Cost to complete the plans bull Time and cost of bid and award process
bull Overall cost to Award
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Projects uWizing JOCs will be measured against the California Department of Transportat ion (Caltrans) District lls Minor Project Program as a baseline for traditional design-bid-build projects
VI REPORTING
An interim report will be completed two and four years into the process with a final submitted afterthe five year period has ended A report will be generated if a JOC has not been utilized stating no JOCs used The reports will contain a comparison of the JOC vs Caltrans process on each JOC used utilizinging the Measures listed above The final report will include an overall evaluation of the project along with any suggestions and recommendations for improving the process
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bull Sections 103 and 107 of the Contact Work Hours and Safety Standards Act (40 USC 327-330) as supplemented by Department of Labor regulations (29 CFR part 5)
bull The Federal Fair Labor Standards Act (29 USC Section 201 et seq) bull Buy America Requirements (49 CFR Part 661 and Section 165 of the Surface
Transportation Act of 1982) and bull Disadvantaged Business Enterprise Program (49 CFR Part 26)
The General Accounting Office has fully reviewed the JOC concept and found it to be consistent with all federal procurement laws and policies
The JOC concept was designed with internal controls as an integral part of the checks and balances process The JOC concept relies on automated software developed by a consultant to SANDAG which provides an excellent audit trail of all JOC job orders and transactions as well as various verification programs to ensure the integrity of the JOC database
IV SCHEDULE
As of October 2011 SANDAGs existing JOC program for regionally funded projects has resulted in the completion and issuance of 61 job orders totaling approximately $272 million Approximately a third of those were related to improvements on the state highway system The state highway projects have included demolition chaining and mowing plant establishment and construction of minor operational features Based on this success the region is intending to procure new JOCs by mid 2013 Prior to this new procurement SANDAG wishes to expand the program to include federally funded highway improvements similar to the existing contracts Based on the current expenditure rates the region would anticipate needing two JOes to cover the five-year period for this SEP-14 The first JOC would cover the first three years of the SEP14 for $15 million (2013-2016) The second JOC would be written for the final two years for $10 million (2016-2018) Performance reports will be provided after two and four years with a final performance report provided at the completion of the five year period
V MEASURES
The benefits of JOC can vary by job order however as a program SANDAG expects to see benefits in cost and time The Interim and Final SEP-14 Evaluation Report would address the following
bull Time to complete the plans bull Cost to complete the plans bull Time and cost of bid and award process
bull Overall cost to Award
5
Projects uWizing JOCs will be measured against the California Department of Transportat ion (Caltrans) District lls Minor Project Program as a baseline for traditional design-bid-build projects
VI REPORTING
An interim report will be completed two and four years into the process with a final submitted afterthe five year period has ended A report will be generated if a JOC has not been utilized stating no JOCs used The reports will contain a comparison of the JOC vs Caltrans process on each JOC used utilizinging the Measures listed above The final report will include an overall evaluation of the project along with any suggestions and recommendations for improving the process
6
Projects uWizing JOCs will be measured against the California Department of Transportat ion (Caltrans) District lls Minor Project Program as a baseline for traditional design-bid-build projects
VI REPORTING
An interim report will be completed two and four years into the process with a final submitted afterthe five year period has ended A report will be generated if a JOC has not been utilized stating no JOCs used The reports will contain a comparison of the JOC vs Caltrans process on each JOC used utilizinging the Measures listed above The final report will include an overall evaluation of the project along with any suggestions and recommendations for improving the process
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